Investment Workshop 40: Still at Chautauqua

The Wanderer retired from his engineering job at a major Silicon Valley semiconductor company at the age of 33. He now travels the world, seeking out knowledge from other wealthy people, so that he can teach people how to become Financially Independent themselves.

This is going to be a short post today, as we are tragically sequestered away in what appears to be an 18th century manor nestled away in the British countryside…

Anyway yeah, tough life. We’ll tell you all about it once we get back.

But in the meantime, being somewhat secluded this week has cut off my normally steady diet of news, so opening up CNN for the first time in about a week was a bit of a shock.

Just…Jesus Christ. That is a LOT of stuff going on. It’s not often we see Nazis, Communists, AND the threat of nuclear war all showing up in one week, but…just…Jesus Christ. I think I’m going to shut my laptop off now and go jump back into the pool.

And here’s where I would do an extended spiel about why news like this should be ignored, but because this is Chautauqua week I’ll have to summarize thusly.

Always invest assuming the world will not end. Because if you’re wrong and the market keeps going up as it always does long-term, you’ll have missed out on the gains by huddling in cash. But if you’re right and the world does end…well, who cares about your portfolio at that point?

So because this is a buy day, nuclear war or no nuclear war, Chautauqua or no Chautauqua, we shall do our regularly scheduled buys as always.

Canadian Portfolio

We begin as always by adding in our cash and taking a snapshot of the portfolio…

Asset

Ticker

Unit Price

Units

Market Value

Allocation

Target Allocation

Canadian Bonds

VAB

$25.30

136

$3,440.80

37.90%

40%

Canadian Index

VCN

$30.60

55

$1,683.00

18.54%

20%

US Index

VUN

$43.60

40

$1,744.00

19.21%

20%

EAFE Index

XEF

$29.19

47

$1,371.93

15.11%

16%

Emerging Markets

XEC

$26.03

13

$338.39

3.73%

4%

Cash

–

$1.00

500.59

$500.59

5.51%

0%

We calculate what we have to do to bring our portfolio back onto target…

Asset

Ticker

Target Allocation

Unit Price

Current Market Value

Target Market Value

Current Units

Target Units

Difference

Canadian Bonds

VAB

40%

$25.30

$3,440.80

$3,631.48

136

143.5

7.5

Canadian Index

VCN

20%

$30.60

$1,683.00

$1,815.74

55

59.3

4.3

US Index

VUN

20%

$43.60

$1,744.00

$1,815.74

40

41.6

1.6

EAFE Index

XEF

16%

$29.19

$1,371.93

$1,452.59

47

49.8

2.8

Emerging Markets

XEC

4%

$26.03

$338.39

$363.15

13

14.0

1.0

Cash

–

0%

$1.00

$500.59

$0.00

500.59

0.0

-500.6

And finally we put in our orders being careful not to go into margin…

Asset

Ticker

Unit Price

Action

Fractional Units

Units

Proceeds

Canadian Bonds

VAB

$25.30

BUY

7.5

7

$177.10

Canadian Index

VCN

$30.60

BUY

4.3

4

$122.40

US Index

VUN

$43.60

BUY

1.6

2

$87.20

EAFE Index

XEF

$29.19

BUY

2.8

3

$87.57

Emerging Markets

XEC

$26.03

BUY

1.0

1

$26.03

Total

$500.30

American Portfolio

And now to do the same on the American side. We start by adding in our cash and taking a snapshot of the portfolio…

Asset

Ticker

Unit Price

Units

Market Value

Allocation

Target Allocation

Bonds

BND

$82.06

44

$3,610.64

38.40%

40%

US Index

VTI

$126.44

21

$2,655.24

28.24%

30%

International Index

VEU

$51.55

51

$2,629.05

27.96%

30%

Cash

–

$1.00

507.75

$507.75

5.40%

0%

We then calculate what we need to do to bring our portfolio back under balance…

Asset

Ticker

Target Allocation

Unit Price

Current Market Value

Target Market Value

Current Units

Target Units

Difference

Bonds

BND

40%

$82.06

$3,610.64

$3,761.07

44

45.8

1.8

US Index

VTI

30%

$126.44

$2,655.24

$2,820.80

21

22.3

1.3

International Index

VEU

30%

$51.55

$2,629.05

$2,820.80

51

54.7

3.7

Cash

–

0%

$1.00

$507.75

$0.00

507.75

0.0

-507.8

And finally, we enter in our orders being careful not to go into margin…

Asset

Ticker

Unit Price

Action

Fractional Units

Units

Proceeds

Bonds

BND

$82.06

BUY

1.8

2

$164.12

US Index

VTI

$126.44

BUY

1.3

1

$126.44

International Index

VEU

$51.55

BUY

3.7

4

$206.20

Total

$496.76

And with that we are done. Thanks everyone, and see you next week!

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Disclaimer: The views expressed is provided as a general source of information only and should not be considered to be personal investment advice or solicitation to buy or sell securities. Investors considering any investment should consult with their investment advisor to ensure that it is suitable for the investor’s circumstances and risk tolerance before making any investment decisions. The information contained in this blog was obtained from sources believe to be reliable, however, we cannot represent that it is accurate or complete.

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